Creating focus through category design
What makes a good category, how do you define yours, and what good examples are there?
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Most ‘categories’ that SaaS companies are ‘creating’ are not actually categories.
They might be good ways to describe their product, and offer a marketing shortcut to own a phrase.
But a category isn’t really ‘created’ - it’s defined.
Name the process, not the product
Category Design is a discipline of creating and monetizing new markets in a noisy world. The journey starts first with understanding the problem that you desire to solve. The problem is the proxy for the category and is the strategic element you see missing in the world. That unsolved problem is what keeps you up at night, and drives you to build a product, company and category to solve it. - Play Bigger
A category is a new market that’s defined by a problem experienced by a group of buyers.
Most category projects start by looking internally: what’s a classy, unique way to describe what does our product does? What’s a nice, brandable phrase that we can use in marketing?
That misses a huge opportunity to find a term that is grounded in evidence, not assumption.
Strong category design describes the new game that your customers can play when their problem is solved.
That comes from deeply understanding your customer, and knowing not just their jobs-to-be-done, but their mindset. What’s going on for them in their role and in their business? Ask your customers:
How has our product changed your life?
What does our product free you up to focus on instead?
If you didn’t have our product, what would life be like instead?
When you can define the promised land your customers can achieve, you’re better equipped to name the process through which it is achieved.
Sense-check your category naming
When trying to name your category, ask yourself: will your customers organically admit to it?
Test with this phrase:
Yes, we do [category name].
The category has to be grounded in your buyers and users’ reality. Will they accept it as part of their role (and therefore, their identity)? Will they start bond with others through it, create and join communities, and use the terminology in their CV or mention in interviews, unironically?
Do you need to create a category in the first place?
Nope. Markets do already exist, and creating a category is a long-term commitment. It’s not for everyone.
April Dunford suggests there are three ways to determine your frame of reference:
Head to head: position to win an existing market
Big fish, small pond: position to win a subsegment of existing market
Create a new game: position to win a category you create
If your business goals need immediate clarity and return on investment, defining a category is probably not for you. If you have the space and can invest long-term, get started.
Thinking of your category as a frame of reference for your product in the mind of your customer is a better way to look at it. What do you need to create that space? What shortcuts - existing markets, trends, competitors and alternatives - can you use in that pursuit?
How to define your category
Niche down on your Ideal Customer Profile
Deeply understand your customer’s jobs, gains, pains, and motivations
Use that insight to develop customer-led value messaging
Develop your strategic narrative - undeniable world change, enemies, promised land, and your magic capabilities
Combine your messaging and narrative to investigate the best frame of reference for your product in the mind of your customer, that aligns with your business goals
Put a tiger team on it to test and iterate through friendly customer/prospect conversations, internal presentations, outbound emails, sales decks, paid marketing, organic marketing, external presentations, etc.
Launch - with a marketable lightning strike
Who’s done a good job of creating a category?
There are two great examples in tech that always come to mind.
Drift’s Conversational Marketing
A few weeks ago, I met a CMO named Yvette in the office kitchen at OpenView Venture Partners. She was chewing on a bagel during a lunch break from the VC firm’s all-day speaker event, and she was clearly upset.
“How in the world,” Yvette said, reaching for the cream cheese, “am I going to inform my team that our entire approach to marketing is wrong?” - Andy Raskin
Undeniably, Drift did a great job of building their Conversational Marketing category.
World change: messaging is the primary way people communicate
Enemy: forms - why gate something with a static form?
Promised land: connect to your customers in minutes
Magic: chatbot and live chat for sales conversations
They then executed perfectly with content, training, partner channels, events, a book - literally every trick in the book. There are over 5000+ people on LinkedIn with ‘conversational marketing” in their job descriptions or titles.
Aside: Drift’s new ‘Revenue Acceleration’ category doesn’t have quite the same impact, and is probably more of a good way to describe their product, rather than naming the new game that winners play.
Gainsight’s Customer Success
It doesn’t even sound like a category anymore - it’s just the way that you do account management now.
From the mental model to educate buyers on a new game to huge events, content, and community, Gainsight took a nascent phrase and turned it into a movement that’s now used by over 428,000 people to describe their job on LinkedIn.
What market will assist you in building momentum?
Defining your market - whether through a category, or by using another existing category that already exists - helps focus your strategy and execution. And focus + confidence = momentum.
Thanks for reading! Let me know what you thought - find me on Twitter @jdomanpipe.
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